Tether is set to expand its footprint in the cryptocurrency sphere by introducing its stablecoin, USDT, to the Bitcoin ecosystem via the Lightning Network, a layer 2 scaling solution. This announcement was made at the Plan B conference, a prominent event centered around Bitcoin , in San Salvador, El Salvador.
The integration has been made possible through a collaboration with Lightning Labs, the organization behind the Lightning Network. By utilizing the Taproot Assets protocol, which enhances Bitcoin ’s capabilities to accommodate various tokenized assets, this partnership marks a significant milestone for Tether. Currently, Tether holds the title of the largest stablecoin in the market, boasting a market capitalization of approximately $139.4 billion, significantly overshadowing its nearest competitor, USD Coin, which has a market cap of around $53.1 billion.
In 2024, Tether processed an astounding $10 trillion in transactions, nearing the $16 trillion transaction volume of Visa. The stablecoin operates across more than ten different blockchains, including well-known platforms such as Ethereum , Tron, Solana , and Avalanche. With the new integration, merchants who accept Bitcoin through the Lightning Network will be able to offer USDT as a payment option seamlessly, utilizing the same infrastructure that supports BTC transactions.
This development promises to enhance financial accessibility for millions, especially in emerging markets, where many individuals leverage stablecoins as a protective measure against the depreciation of their local currencies. Lightning Labs has also indicated that this integration could facilitate a future surge of transactions involving artificial intelligence and autonomous vehicles, in addition to enabling micropayments using USDT on the Lightning Network.
In a related move, Tether has recently established its operations in El Salvador, the first country to officially recognize Bitcoin as legal tender. This follows the government’s earlier introduction of a Bitcoin Lightning Network-supported wallet, although the uptake among residents has been somewhat limited. Recent policy adjustments have also allowed merchants to opt out of accepting Bitcoin payments, responding to broader economic discussions tied to international financial agreements.
